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19 March 2011

19 03 2011 - Patrick Dewhurst - THE JUSTICE ministry could soon investigate 22 subsidiaries of Cyprus-registered telecommunications firm after Indian authorities requested their help in unravelling a €479 million money laundering scandal.

According to Indian press reports, former Indian Telecom minister Andimuthu Raja allegedly received the money in bribes during the bidding process for India’s 2G mobile phone spectrum

The spectrum was eventually sold well below value, costing the Indian government an estimated €7.98 billion (Rs 50,000 crore).

The scandal, dubbed “Raja-gate” by the Indian press, has now reached Cyprus’ shores after India’s Central Bureau of Investigation (CBI) and Enforcement Directorate (ED) wrote to the justice ministry to ask for help in tracing some €469m, which they believe could have been hidden in Cyprus.

The head of Cyprus’ Unit for Combating Money Laundering (MOKAS) Eva Rossidou-Papakyriacou, confirmed that the justice ministry had received a request, but noted that it did not contain any reference to money laundering.

Rossidou-Papakyriacou also said that MOKAS had not yet received instructions to begin an investigation, while the justice ministry could neither confirm nor deny that it had received the request.

However, a senior justice ministry official told the Cyprus Mail yesterday that they regularly receive such requests from governments around the world.

The official said: “What I can say is that as the central authority for receiving requests and we receive requests every day from other governments, and we follow the EU convention on such requests.”

The official explained that once a request is received by the justice ministry, it is passed to the relevant authority who may be invited representatives from the requesting government to help with the investigation.

According to the online newspaper, livemint.com, the CIB and ED may send a team in April to Cyprus and Mauritius- where it has been alleged that Raja could have channelled some of the ill-gotten fortune, via his wife’s bank account.

One official reportedly said: “We suspect that some beneficiaries have routed kickbacks to these countries under the guise of investments. The CBI sent the letter rogatory to Mauritius and ED to Cyprus. The team will expedite the process of getting information from both countries.”

Another official reportedly said letters had been sent to Singapore, The United Arab Emirates and Russia, “But we have strong suspicion that most of the kickback money was routed to Mauritius and Cyprus only” and then channelled “through 22 of its subsidiaries registered in Cyprus by way of loan, equity and investments.”

Raja resigned from his job as India’s telecoms minister in November 2010, insisting that he had done no wrong and that his conscience was clear.

The Indian High Commission in Cyprus were unavailable for comment yesterday.